Federal Reserve Chairman Jerome Powell (Wikimedia Commons)
Private entities aren’t needed to build central bank digital currencies, said the head of the U.S. central bank on Wednesday.
Federal Reserve Chairman Jerome Powell, speaking , said the idea of a digital dollar – a blockchain-based version of the current world reserve currency – is complex, and one that the Fed takes seriously, but also that the idea needs to be studied further before one can be created and implemented. However, in response to a question from Rep. Tom Emmer (R-Minn.), Powell said he believed private entities did not have a role in designing a digital dollar.
“I do think this is something that the central banks have to design,” he said. “The private sector is not involved in creating the money supply, that’s something the central bank does.”
Emmer was asking specifically about a recommendation from the Digital Dollar Project, which was launched earlier this year by former Commodities Futures Trading Commission Chairman J. Christopher Giancarlo, Chief Innovation Officer Daniel Gorfine and Accenture Director David Treat. The project suggested a digital dollar be issued by the Fed but designed in partnership with the private sector and accessible through similar to the one in place in the U.S. today.